By
Evan Niu, CFA
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More Articles
October 24, 2012
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If you've tried to go out and buy an Apple (Nasdaq: AAPL ) iPhone 5 anytime recently, you'll know they're rather hard to come by. Even now, over a full month after that device's launch, new orders placed on Apple's web site remain supply constrained and ship in three to four weeks. Yesterday, the iPhone maker unveiled its expected iPad mini. Is it destined to suffer the same fate?
NPD DisplaySearch analyst Richard Shim believes it will. In a blog post, Shim said he expects the iPad mini to be supply constrained from the get-go, with the source of production bottlenecks tied to display panel supply. Apple is reportedly working with two pairs of display suppliers and assemblers for the device: LG Display (NYSE: LPL ) and Foxconn, as well as AU Optronics (NYSE: AUO ) and Pegatron. Noticeably absent is Samsung; Apple is not tapping its frenemy for the 7.9-inch displays this time around.
As a relatively new supplier, AU Optronics is expected to be facing some challenges as it ramps up to the volumes that Apple needs. These are Shim's iPad unit monthly estimates for each panel supplier.
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Supplier
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September
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October
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November
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December
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LG Display
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300,000
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1 million
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2.5 million
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3 million
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AU Optronics
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100,000
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400,000
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800,000
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1 million
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Total
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400,000
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1.4 million
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3.3 million
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4 million
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Source: NPD DisplaySearch.
If these figures are accurate, that totals 9.1 million iPad mini units through year's end, which happens to coincide pretty closely with prior reports that Apple had ordered 10 million units from its suppliers. That would be nearly double the 5 million Kindle Fire HD units that Amazon.com (Nasdaq: AMZN ) has ordered. Amazon has said the new $199 model has quickly become its best-selling device by unit sales on its site, but the company (as per usual) refrained from elaborating with actual numbers.
Initial supply may be constrained for the iPad mini's global launch, but fortunately it looks like it should be able to ramp up fairly quickly.
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